It used to be when you heard someone talk about fasting, they were talking about food. But in an economy that offers fewer and fewer jobs and has consumers who are being crushed under a mountain of debt, people are trying a new form of fasting; the spending fast. Just like a dietary fast, a spending fast entails abstaining too, but in this case people are abstaining from shelling out the dough, not swallowing it down. If the turn in the economy has you at a point where some serious economic changes need to be made, consider trying some of the following spending fast tactics.
Make a financial spreadsheet and review your income, debt and savings. Figure out where your money is really going. Decide what you’ve been doing right, and make an assessment about where you’ve been going wrong. Knowing where you’ve been spending unnecessarily can keep you from perpetuating bad spending decisions. Then, set your goal. Are you going on a spending fast so you can use your savings to pay off debt?
If your goal is to get rid of credit card debt, prioritize which cards you want to pay off first. For some good suggestions on how to get rid of debt quickly, visit your local library to borrow (yes, borrow—not buy!) books written by financial gurus. For instance, try Bach’s book Debt Free for Life, which offers a strategy for prioritizing your credit card payments to pay off debt more quickly. Or visit the website of no-nonsense personal financial expert Suze Orman, who constantly challenges people to question whether a purchase is a sound decision. Her website offers free calculators, including an expense tracker and a debt eliminator.
Only buy what you truly need
If you stop off at Starbucks on your way into work Monday morning because you “need” a Venti Decaf Pike Place Roast and an Apple Bran Muffin, it may be time to re-examine what the word need means. Does that $10 bill you’re about to pull out of your wallet really need to be handed over to the Starbucks clerk?
Seek the help of others who’ve determined the difference between wants and needs to get you on your way. Check out the website AndThenWeSaved.com, where spending fast expert Anna Newell Jones (who, through following a no-nonsense approach to debt reduction, eliminated $24K of her own debt) offers tips and guidance, as well as the support of a community who’ve made the leap from in debt to penny-wise.
Cut back on the things that you can’t do without
Of course there are certain things that you won’t be able to go without — even during your spending fast. You’ll have to continue to pay your bills and buy groceries, but even these things can be done wisely. Pull the staples that have moved to the back of your pantry forward, and use them before going to the store to buy more groceries.
Remember, your goal is to avoid spending. During your fast, you might feel like having a steak dinner, but if you’ve got pasta and sauce in your cabinet, resist the urge; use what you’ve already got on hand. And don’t forget to do research on how to save on the things you absolutely must spend money on. Scour the web for tips and tricks. Financial pro Clark Howard offers tips on his website, including where to buy groceries at the lowest prices. Don’t forget to visit your grocery store’s website for weekly deals, or websites like RetailMeNot.com for coupon codes.
Keep your eye on the prize
Whatever your goal, make sure you remind yourself of it daily. Was your goal to get rid of your credit card debt? Review your financial spreadsheet frequently during your spending fast and watch how the money you aren’t spending is making a dent in your balances. Was your goal to save enough for that trip to Venice that you’ve always dreamed of? Put a postcard of Italy in your wallet so you’ll be reminded of your goal when you’re reaching for cash. Keeping your eye on the prize can really keep your spending fast on track.
With a little hard work and determination, your spending fast can really improve your financial health — fast!